Friday, March 18, 2011

ADJUSTED MONETARY BASE SKYROCKETS

ADJUSTED MONETARY BASE An almost $400 BILLION increase since January.....the most since 2009 crisis began.....and we're 2 years into recovery??????????? still at 0% interest rates? STILL playing games with currencies? STILL claiming there is no inflation?

"A succinct reminder from Mises Institute: "The Adjusted Monetary Base is the one monetary component completely under the control of the Federal Reserve." As we expected a month ago when predicting the end of the SLP program, look for this chart to surge to about $2.7 trillion as the combination of SLP unwind and another $500 billion in UST purchases adds another $600 billion to the BASE. The increase of $142 billion in the last two weeks is the 5th largest Adjusted Monetary Base expansion in history. The ongoing verticalization of this chart may result in some further acuteness of inflationary expectations."

Explanation for the YEN rising is the prospect of rebuilding the tsunami area will attract YEN...rising currencies are BAD for exports as prices rise with appreciation....funny how a US $ in the TOILET isn't making much difference for us.....except stoke inflation......as cost of OIL imports and inflated economies raise prices of goods sent to US will get passed on to consumers at some point....if companies eating any of this, it should hurt their profits big time.

Yesterdays rally was strong enough on surface but volume fell significantly vs decline day....buying was more selective into big caps as small and mid cap stocks underperformed.

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